Blockchain: Hype and Reality

Depending on who you listen to, blockchain is either an over-hyped oddity or a milestone in legal and financial innovation comparable to double-entry bookkeeping. In essence, blockchain is a decentralized, immutable electronic ledger; a write-once-read-many record of historical transactions, as opposed to a database that can be written over.

So what relevance does blockchain have for the telecom industry, if any? We decided to explore the drivers for adoption of blockchain by communications service providers (CSPs) and evaluate the main opportunities. The results were published this week in Heavy Reading’s latest report, Blockchain Opportunities for CSPs: Separating Hype From Reality.

We found that around a third of CSPs are already considering or actively engaged with blockchain projects, mainly to address security concerns. BSS and OSS are also potential areas for blockchain disruption in areas such as number portability and billing. There don’t seem to be many applications at the network layer, although some forward-thinkers have postulated its use in the control plane for network addressing.

Although there is strong interest in blockchain, as evidenced by the popularity of this panel at the upcoming Light Reading conference on software-defined operations, we should not get too carried away. Blockchain can be used to solve many trust-based problems, but sometimes these can be solved more economically using traditional database technology.